TRADING FORK EXTREMES – 3 month Setups.

[Summerset]

Originally Posted by Summerset

Recommendation:-

Long (3265-95) to 2.5% size this week.
Double at 3189, to 5% net.
Hedge longs to be taken at 3265-95 by shorts @ 3445-75 (stops @ 3540), especially if 3445/75 higher levels are seen first.

Profitable Trading

We would have of course raised stops to entry by now.

DAILY:- (Chart-A)

Price bounced at a confluence of phi lines @ 2.618 & 1.618, both thrown from pivots (B) of wave-3.

For upwards mpmentum to continue, we need a close outside the Phi channel of the corrective 4th wave, thrown from pivot A.

Should this happen, it will confirm the end of the zigzag correction, and begining of either a Flat correction, or outbreak of wave-5. We would then hold our longs.

Should price fail to break outside the phi channel of the corrective wave. We will close the longs, and short there (3430-3460).

To monitor this situation, (hold or close) we move on to CHART-B (4hrs)

INTRADAY:- (CHART-B)

Breakout of the corrective channel, will be marked by a penetration upwards of the CCi above the ADX shown.

+ve CCi divergence with price is showning to forecast this happening.

The ADX has also made a high extreme turn signaling reversal from -ve DI pressure --> +ve DI pressure. The extreme turn of the ADX also idealy shows that when superimposed on the CCi, the ADX will cross the CCi down, as the CCi is currently heading up.

We therefore expect the CCi graph to make the +ve cross, and support on the green support line shown.

It is advised to start hedging the longs once the CCi makes an extreme turn down above the green support line.

However, should the CCi bounce downwards on its coming test at the ADX line. And price fall below Eurodollar's intraday lower breakout range. As advised above, we would be closing longs & shorting --> 3190.

RECOMENDATION:-

If a flat does unfold next week, we would consider closing the longs at 3520. And relonging at the subsequent lower phi lines. (3360-80).
My prefered bias, is for this to happen, and will be monitored by choppy action of the CCi above the ADX.

Should the CCi fall below the ADX again, it would mark a running flat, that could take price again to the 2.618 @ 3175-90. Though unlikely scienario, will clearly show if the CCi breaks below the ADX again. Or more importantly, makes a severe negative down rejection (CCi X ADX) but on Daily frame. - This should be attemting to cross upwards towards this week's end.

Profitable Trading

[alexandre1647]

Hi Summerset,
Is everything OK with your Metatrader?
I'm asking this because today my antivirus found 4 viruses in my MT and moved some files to the vault. I tried to download a fresh version of MT and my antivirus again found viruses. Everything was fine before.
Regards,
Alex.

[Summerset]

Originally Posted by alexandre1647

Hi Summerset,
Is everything OK with your Metatrader?
I'm asking this because today my antivirus found 4 viruses in my MT and moved some files to the vault. I tried to download a fresh version of MT and my antivirus again found viruses. Everything was fine before.
Regards,
Alex.

Hi Alex,

Except, for a Eurodollar Chart that gives an elongated candle. Everything is OK with my metatrader station.

I had a couple of mails a while back from MT warning of a virus threat, & how to erode it. U must have got it to, as I believe its was a circulatory mail.

Try to dowload SB instead. Or Download MT from a MIG site as a demo, it should be a safe copy.

All the Best

[Summerset]

Originally Posted by Summerset

Recommendation:-

Long (3265-95) to 2.5% size this week.
Double at 3189, to 5% net.
Profitable Trading

If yr still holding longs, double in 2 halfs @ 3592, & 3558 - SL 3532. Target 3720 for 50% & 3780 for rest.

If U've liquidated re-long 3592 --> 3780. SL 3532

Profitable Trading.

[Summerset]

There is of course anticipation in the market to short above 40 levels, for a down break of the rising wedge. This sentiment will fuel price to devour stops of shorts taken at 1.40 heighs. So don't be surprised to see price make 1.42 in the process.

The attached chart shows that price is currently testing the very high median of the controlling fork. (shown in dashed line).

Price has also fallen outside the Phi channel controlling the structure of Wave-1 of the current 5-wave sequence. (This phi channel is shown in blue & red lines). Price is currently re-testing the 2.618 red line of this phi-channel

We expect a long awaited fall from the fork median high to support at the fork 61% --> 50% AR lines (shown in dotted lines). Note that this is also were the last broken resistance (Shown in blue elipse) will turn into support on the Grey modual strech out.

We recommend to buy there <3600>, and as far up as 3680, and target the 2.618 blue line of the phi channel, thrown from the last major corrective wave of Dec'04-Dec'05. (This phi channel is shown in black & blue lines).
And is smoothed to accomodate supports & resistances of subsequent price action.

At the 2.618 blue phi-line, we will sell.

Schematically, this is the general plan across a 3 month duration.

To generate correct entries & exits, we will test a powerful index, and signal line on it, and make the calls at market time here for those interested, over the coming 4 week period.

Profitable Trading.

[golhuntsleep]

4070 or so is where wave 5 will have equallity with wave 3....wave 1 is larger than wave 3 so, using elliot rules, that wave 3 cannot be the shortest.....the closer we get to 4070 the more I will be willing to locate the top......a break of that level would force me to find an alternative count and that would be that we are still in a 3rd wave of this last move....which is completely possible considering that summer trading is almost upon us and the range trading that we normally see make up 4th waves..........my hunch is we'll break 4070 and do our normal range trading till Labor day make a last surge and then see the dollar recover dramatically......just trying to find the right mix of timing and price.....

[Summerset]

Originally Posted by golhuntsleep

4070 or so is where wave 5 will have equallity with wave 3....wave 1 is larger than wave 3 so, using elliot rules, that wave 3 cannot be the shortest.......

Hi Gol,

I am actually becoming more & more biased to the attached count & scienario below.

According to this, wave-1 start shifts to 2.618 phi of the Dec'04-Dec'05 correction. (Shown in Gold dash lines).

In this case Wave-1 becomes already equal to Wave-3, with a mere difference of 50pts.

Wave-5 should, (& will) extend to a fib multiple of 1-->3. But it will be so complex & grand that it will take the fall out of the current wedge to its designated target as one of its subwaves, in a complex unfolding extended 5-wave structure for wave-5.

I believe a prolongation of the current economic fundamentals will have a decisive role to play in this. As the market discounts global changes.

For the current mid term outlook, that more or less impacts our trading. I agree that 4050 will be gradually, even easily seen in the next rally.

I expect to see a lot of noise & damage between 4200/4300, to convince market speculators that the new highs & levels are here to stay.

The more the market keeps at this - the more trader physchology changes and accepts / becomes convinced of the new reality. That's when the plunge down comes, with lashes & spikes upwards to feed on the small fish - (usually us till now).

Lets hope we will all be BIG enough by then sailing tranculent calm waters.

Have a profitable trading week.

[golhuntsleep]

I'm with ya......I've been smelling a rat for a while on the euro and pound that we are acually in 3rd waves still....what gave me the clue is one of my customized indicators that helps my find long term tops......I think 3 will end soon, then summer range trading will form our 4....we may even have to adjust our trendlines a bit before we see the dollar rally we all have been anticipating.......remember also, that a weak dollar is very good for America here in the short term, paying for the war and the deficet is easier with cheap money.......